Why Is Intuitive Surgical Stock Up 80%?

Intuitive Surgical has reported a remarkable 74% increase in revenues, reaching $7.6 billion compared to $4.4 billion in 2020. This growth is largely driven by the rising demand for its da Vinci Surgical System, which facilitates minimally invasive surgeries. The installed base of these systems has grown by 54%, from 5,989 units in 2020 to 9,203 units currently, significantly bolstering the company's sales performance. The company categorizes its sales into three segments: da Vinci Surgical Systems, Instruments & Accessories, and Services. The Instruments & Accessories segment has seen its contribution to total sales rise from 56% in 2020 to 60% now, with expectations to reach 63% in the next three years. This segment is particularly lucrative, as it has a higher profit margin, which has improved the overall operating profit margin to 25.8% from 24.1% in 2020. The launch of the latest da Vinci 5 platform in the U.S. earlier this year is anticipated to further enhance sales growth. As the installed base increases and more procedures are performed, the Instruments & Accessories segment is expected to thrive, leading to better financial performance. Overall, Intuitive Surgical is on a promising trajectory for sustained growth, driven by its innovative products and expanding market presence, despite having underperformed the S&P 500 in 2022.